Select Committee on Foreign Affairs Minutes of Evidence


Written evidence submitted by M. Pierre Mirel, Enlargement Directorate, European Commission

RELATIONS BETWEEN THE EU AND CYPRUS

1.  ACCESSION OF A DIVIDED CYPRUS

  In 1990, the government of the Republic of Cyprus applied for EU membership in the name of the whole island. Drawing on the European Commission's opinion of 1993 the Council decided in 1995 that accession negotiations with Cyprus would start. In return, Greece gave up its long-running veto against the establishment of a customs union between the EC and Turkey. When the negotiations started in 1998, President Clerides invited the Turkish Cypriots to be included in negotiations, an invitation that Mr Denktash declined.

  As for the conditions of Cyprus' accession, a similar package deal was concluded at the European Council of Helsinki (1999). On the one hand the Council accepted the Greek demand and decided that its decision on accession would "be made without the above [a solution to the political problem] being a pre-condition." On the other hand, the European Council stated that "Turkey is a candidate State destined to join the Union on the basis of the same criteria as applied to the other candidate States".

  On 1 May 2004 Cyprus became a member of the European Union. There are two specific protocols to the Act of Accession 2003 concerning Cyprus:

    —  Protocol 3 on the British Sovereign Base Areas and

    —  Protocol 10 on Cyprus defining the terms of Cypriot accession in view of the de facto division of the island (attached to this memo).

  The main features of this Protocol 10 are the suspension of the acquis (the EU body of legislation) in the north (Article 1) and the enabling clause (Article 4). In view of the spirit and purpose of the Protocol, the acquis suspension is to be understood territorially, meaning that Turkish Cypriots enjoy the (personal) rights deriving from EU citizenship. Article 4 keeps the doors open for the Turkish Cypriots as it enables the European Institutions to adapt—in the event of a settlement—in a simplified procedure the terms of Cyprus' accession with view to the Turkish Cypriots. In addition, Article 2 of Protocol 10 provides a legal basis for a special regime defining the terms under which EU law will apply to persons, goods and services crossing the line (see below 2.). Article 3 ensures the possibility of assistance to the northern part after accession of a divided Cyprus (see below 3.)

2.  GREEN LINE REGULATION

  On 29 April 2004 the Council adopted the so-called Green Line Regulation based on Article 2 of Protocol 10 (Council Regulation 866/2004). It provides for special rules concerning the crossing of goods, services and persons. The Regulation had to take account of the particularity of the situation and the political sensitivities on the island. It had to cover, inter alia, issues like prevention of illegal immigration, customs, food safety, taxation, and travel facilities. Generally speaking, it was important to find a balance between the need to establish a clear legal framework and the need to avoid the deepening of the divide.

  The implementation of the provisions related to the crossing of persons is running fairly smoothly. Free movement of EU citizens throughout the island, irrespective from their point of entry, is ensured.

  The Green Line Regulation has become fully operational as regards trade only on 23 August 2004, when specific (implementing) rules concerning the crossing of goods entered into force. During the two months since the Green Line Regulation is operational, goods worth only

100,000 crossed the line. The main products were lead ingots, terra umbra, paper, vegetables and melons. Unfortunately, there are still many obstacles. One technical example is the question of recognition of Turkish Cypriot truck driving licences. More spirit of cooperation and trust between the two communities is needed for a proper functioning of the Green Line trade.

  In the light of the experience gained since the Regulation is operational, the services of the European Commission reflected on possible amendments with the aim to further facilitate the crossing of the line and to contribute thereby to the integration of the island. Just to give an example: rules concerning travellers could be relaxed (currently the value of goods contained in the personal luggage must not exceed

30 per person; this ceiling could be increased). Furthermore, trade in certain agricultural goods (in particular citrus fruit as the main export good) as well as in animals and animal products (such as fish and honey) should be facilitated.

3.  SUPPORT TO THE TURKISH CYPRIOT COMMUNITY

  Responding to the invitation of the Council following the outcome of the referenda on the Annan Plan[1] the Commission proposed on 7 July 2004 a comprehensive package of aid and trade measures which aim to put an end to the isolation of the Turkish Cypriot community.

  The financial instrument (

259 million 2004-06) is expected to be adopted by the Council on 23 November after the EP has given its opinion. The Commission would entrust the European Agency for Reconstruction (currently responsible for the management of EU assistance in the Balkans, located in Thessaloniki) with the implementation of large infrastructure projects under this regulation.

  The fate of the regulation for direct trade between the north and EU-24 is somewhat unclear. Cyprus is categorically opposed to the direct trade regulation. The question of the appropriate legal basis remains open. Discussions in the Council continue on this proposal. The Turkish Cypriot side made it clear that the direct trade regulation is much more important than the financial assistance. The reasons for the need for direct trade are:

    —  the isolation of the Turkish Cypriot community can only end if we render direct contacts possible;

    —  economically more advantageous to trade directly than via middle-men and other ports; besides, preferential conditions should help exporting the products;

    —  at present trade with the areas is in principle open and takes already place under non-preferential conditions in a limited scale (in 2003 exports from the areas to EU Member States amounted to approx. US$13 million)

    —  trade across the Green Line is just not sufficient—there are too many obstacles (eg driving licences). During the first two months since the Green Line Regulation is operational, goods worth only approximately

    100,000 crossed the line. This is definitely not sufficient to end the economic isolation of the Turkish Cypriots.

  Under the umbrella of the UN talks on the island, the European Commission has started a process of explaining the EU body of legislation (acquis) to the Turkish Cypriots in February/March 2004. Arrangements are progressing well concerning support to alignment with and preparation for the implementation of the acquis in the northern part of Cyprus. Meetings involving Member States expert teams, Turkish Cypriot participants and the different European Commission services as well as expert missions to the north take place constantly organised by the European Commission service for Enlargement (TAIEX office).

  Finally, a pilot project on de-mining activities in Cyprus was launched (worth

2.5 million), the implementing agency being the United Nations Development Programme (UNDP). The clearing of mines in the buffer zone started on 16 November.

4.  PEACE PROCESS

  Although the prospect of EU accession served as a catalyst towards more focused efforts to foster a comprehensive settlement of the Cyprus problem (conclusions of the accession negotiations in December 2002 in Copenhagen, peace talks in The Hague in March 2003 with a view to the signature of the Accession Treaty, Bürgenstock talks and the referenda just before accession), and in spite of manifold EU support of the UN peace process, a solution to the political problem has not yet been reached.

  The UN plan for a comprehensive settlement of the Cyprus problem failed to gain the necessary support at the simultaneous referenda held in Cyprus on 24 April. While the Turkish Cypriots approved it by a margin of 2:1, Greek Cypriots rejected it by a margin of 3:1. The Annan Plan is therefore null and void.

  In the report on his good offices mission of 28 May 2004, the UN Secretary-General welcomed the decision of the Turkish Cypriots and called the decision of the Greek Cypriots a "major setback". In his view the Turkish Cypriot vote has "undone any rationale for pressuring and isolating them".

  In his report on the work of the organisation of 20 August, the UNSG repeated that he sees at present no basis for resuming his good offices in Cyprus. He expressed his hope that the Greek Cypriots would "reflect on their position so that future efforts can have a good chance to succeed." The UNSG repeated his call upon the Security Council to encourage States "to lift unnecessary barriers that isolate the Turkish Cypriots and impede their development."

  No new international initiative is to be expected in the near future. Cyprus neither does not seem to have a plan/idea to break the deadlock. Concerning its possible role in a new process, the European Commission remains ready to support efforts towards a settlement that would permit a reunified Cyprus to be fully integrated in the European Union.

  In the event of a settlement, the EU will make use of the enabling clause (Article 4 of Protocol 10) and adapt the terms of Cyprus' accession with regard to the Turkish Cypriot community.

  [Note: This memorandum is not an official, formal European Commission document. It is merely a factual paper to help understand where the EU stands in its relations with Cyprus.]

11 November 2004

259 million already earmarked for the northern part of Cyprus in the event of a settlement now be used for this purpose."

PROTOCOL No 10

ON CYPRUS

THE HIGH CONTRACTING PARTIES,

  Reaffirming their commitment to a comprehensive settlement of the Cyprus problem, consistent with relevant United Nations Security Council Resolutions, and their strong support for the efforts of the United Nations Secretary General to that end,

  Considering that such a comprehensive settlement to the Cyprus problem has not yet been reached,

  Considering that it is, therefore, necessary to provide for the suspension of the application of the acquis in those areas of the Republic of Cyprus in which the Government of the Republic of Cyprus does not exercise effective control,

  Considering that, in the event of a solution to the Cyprus problem this suspension shall be lifted,

  Considering that the European Union is ready to accommodate the terms of such a settlement in line with the principles on which the EU is founded,

  Considering that it is necessary to provide for the terms under which the relevant provisions of EU law will apply to the line between the abovementioned areas and both those areas in which the Government of the Republic of Cyprus exercises effective control and the Eastern Sovereign Base Area of the United Kingdom of Great Britain and Northern Ireland,

  Desiring that the accession of Cyprus to the European Union shall benefit all Cypriot citizens and promote civil peace and reconciliation,

  Considering, therefore, that nothing in this Protocol shall preclude measures with this end in view,

  Considering that such measures shall not affect the application of the acquis under the conditions set out in the Accession Treaty in any other part of the Republic of Cyprus,

  Have agreed upon the following provisions:

ARTICLE 1

  1.  The application of the acquis shall be suspended in those areas of the Republic of Cyprus in which the Government of the Republic of Cyprus does not exercise effective control.

  2.  The Council, acting unanimously on the basis of a proposal from the Commission, shall decide on the withdrawal of the suspension referred to in paragraph 1.

ARTICLE 2

  1.  The Council, acting unanimously on the basis of a proposal from the Commission, shall define the terms under which the provisions of EU law shall apply to the line between those areas referred to in Article 1 and the areas in which the Government of the Republic of Cyprus exercises effective control.

  2.  The boundary between the Eastern Sovereign Base Area and those areas referred to in Article 1 shall be treated as part of the external borders of the Sovereign Base Areas for the purpose of Part IV of the Annex to the Protocol on the Sovereign Base Areas of the United Kingdom of Great Britain and Northern Ireland in Cyprus for the duration of the suspension of the application of the acquis according to Article 1.

ARTICLE 3

  1.  Nothing in this Protocol shall preclude measures with a view to promoting the economic development of the areas referred to in Article 1.

  2.  Such measures shall not affect the application of the acquis under the conditions set out in the Accession Treaty in any other part of the Republic of Cyprus.

ARTICLE 4

  In the event of a settlement, the Council, acting unanimously on the basis of a proposal from the Commission, shall decide on the adaptations to the terms concerning the accession of Cyprus to the European Union with regard to the Turkish Cypriot Community.





1   The Council stated on 26 April 2004: "The Turkish Cypriot community have expressed their clear desire for a future within the European Union. The Council is determined to put an end to the isolation of the Turkish Cypriot community and to facilitate the reunification of Cyprus by encouraging the economic development of the Turkish Cypriot community. The Council invited the Commission to bring forward comprehensive proposals to this end, with particular emphasis on the economic integration of the island and on improving contact between the two communities and with the EU. The Council recommended that the Back


 
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